- Quarterly revenue up 8%
- Adverse US betting results
- Guidance updated for acquisitions
Online sports betting group Flutter Entertainment (FLTR) said first-quarter group revenue grew by 8% thanks to a strong performance in the US where its leadership position continues to scale.
Despite the strong showing, the FTSE 100 firm noted adverse US March Madness sports results would impact its full-year US core profit guidance by $180 million at the mid-point of the range, taking the shine off an otherwise solid update, and knocking the shares down 2% in early trading.
WHAT THE COMPANY SAID
Chief executive Peter Jackson commented: ‘I am pleased with the performance of the business during the first quarter, with the scaling of our US business driving a step change in the earnings profile of the group.
‘FanDuel continues to win in the US, retaining leadership positions in both online sports betting and iGaming, while we saw a positive performance within International, where our scale and the competitive advantages of our Flutter Edge have been enhanced by the acquisition of Snai in Italy.’
US revenue increased by 18% to $1.7 billion in the three months to the end of March, with the sportsbook up 15% and iGaming up 32% resulting in market shares of 43% and 27% respectively.
Adjusted EBITDA (earnings before interest, tax, depreciation and amortisation) jumped to $161 million from $26 million reflecting strong operational gearing as more revenue dropped through to profit and sales and marketing costs shrunk as a percentage of revenue.
International revenue grew 3% to $2 billion, which masked wide variations in regional performances, while international EBITDA was 2% higher at $518 million.
GROUP GUIDANCE UPDATE
Flutter nudged up its full-year group EBITDA guidance to a range of $2.96 billion to $3.4 billion, reflecting expected contributions from Snai and the acquisition of NSX which completes in May.
Group revenue is now expected to grow 22% to $17.1 billion at the middle of the range, up from $15.9 billion previously.
Analyst Paul Leyland at gambling consultancy Regulus Partners commented: ‘Flutter has done what it promised to at the beginning of the year in maintaining momentum in the US market and delivering solid profitability, while net flatlining everywhere else (net +3% cc) pending the acquisition of two promising local heroes (Snai and NSX).
‘Our key concern with Flutter’s Q125 results is the group has taken or underperformed market performance pretty much everywhere other than US igaming (where gains are operational), Turkey (swimming against a tide of newly printed lira) and India (where the bounce has a rather feline quality given the tax situation).’
